2024-04-17 12:24:35 ET
Summary
- Fed Chair Powell signals a hawkish turn in monetary policy, ruling out interest rate cuts until inflation falls sustainably or the labor market weakens.
- The Fed's dovish pivot in 2023 boosted inflation and delayed the recession, leading to a potential deeper and longer recession in the future.
- The S&P 500 is facing a recessionary bear market and, in the near term, a deeper correction due to higher interest rates and a contraction in the PE multiple.
The hawkish turn
Fed Chairman Jerome Powell participated in a policy forum discussion on Wednesday (the Wilson Center's Washington Forum on the Canadian Economy), and signaled a hawkish turn with respect to the expected monetary policy....
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Powell Turns Hawkish - Is Higher For Longer Now 'Higher Until Recession'?